Hitachi, Ltd. · TSE:6501
Hitachi — Investor Day (June 2021)
41 slides from Hitachi's investor day presentation, Jun 8, 2021
Slide 1: Hitachi Investor Day 2021 Industry Sector
Hitachi Investor Day 2021 Industry Sector June 8, 2021 Masakazu Aoki Executive Vice President and Executive Officer General Manager of Industry Business Division © Hitachi, Ltd. 2021. All rights reserved.
Slide 2: Key Messages Today
Key Messages Today Digital Transformation (DX) Accelerating 1 in the New Normal Era - Responses to Market Changes in Manufacturing and Distribution Industries Due to COVID-19 - 2 Expansion of Total Seamless Solutions Utilizing Lumada 3 Development for Global Growth © Hitachi, Ltd. 2021. All rights r
Slide 3: Contents
Industry Sector Contents 1. Overview of the Industry Sector 2. Progress of 2021 Mid-term Management Plan 3. Expansion of Total Seamless Solutions 4. Development for Global Growth 5. Conclusion © Hitachi, Ltd. 2021. All rights reserved. 2
Slide 4: Contents: Overview of the Industry Sector
Industry Sector Contents 1. Overview of the Industry Sector 2. Progress of 2021 Mid-term Management Plan 3. Expansion of Total Seamless Solutions 4. Development for Global Growth 5. Conclusion © Hitachi, Ltd. 2021. All rights reserved. 3
Slide 5: Position of the Industry Sector
1-1. Position of the Industry Sector Automotive IT Energy Industry Mobility Smart Life Systems Business Financial Institutions BU Systems BU Social Infrastructure Nuclear Energy BU Energy BU Distribution BU Industry & BU Water & Environment Building Systems BU Railway Systems BU Solutions Hitachi Gl
Slide 6: Business Overview
1-2. Business Overview Industrial Products Business Industry & Distribution BU Mass-production business [28%] Digital solution business - Air compressors - Drive systems - Marking systems 44% 36% - Power Substation equipment 858.1 billion yen FY2020 Result Built-to-order business [16%] 20% Water & E
Slide 7: Sector Structure
1-3. Sector Structure The Sector and Hitachi Group Promote Business for Customers in Industry and Distribution Fields Hitachi Group’s Industry Sector business potential in Industry and Distribution fields IT Sector Masakazu Aoki Executive Vice President and Executive Officer 858.1 billion yen Hitach
Slide 8: Business Domains
1-4. Business Domains Providing digital solutions by utilizing strengths with Products x OT x IT Creating customer value in value chains AI Analytics Cloud Big data processing Security control system Management/ IT Production planning/ Supply chain optimization Maintenance, control optimization Logi
Slide 9: Contents: Progress of 2021 Mid-term Management Plan
Industry Sector Contents 1. Overview of the Industry Sector 2. Progress of 2021 Mid-term Management Plan 3. Expansion of Total Seamless Solutions 4. Development for Global Growth 5. Conclusion © Hitachi, Ltd. 2021. All rights reserved. 8
Slide 10: Progress of 2021 Mid-term Management Plan
2-1. Progress of 2021 Mid-term Management Plan Steady progress is being made through the strengthening of integrated operations in the Industry Sector, although COVID-19 has somewhat impacted the plan Basic policy and ✓ Scaling of digital solutions utilizing Lumada progress (Lumada Core Business: up
Slide 11: Results and Forecasts
2-2. Results and Forecasts FY2020 A huge decline in revenues was expected due to the COVID-19 pandemic. However, revenues were higher than the initial forecast as a result of shift to the digital business and global business expansion Adjusted operating income ratio stood at 5.7% after cost reductio
Slide 12: Trends of the Results of JR Automation
2-3. Trends of the Results of JR Automation ・ After acquisition in the 4th quarter of FY2019, with the impact of COVID-19 pandemic, steady post-merger integration (PMI) efforts led to a considerable increase in orders and revenues ・ Increase business domains in the growing e-commerce and medical mar
Slide 13: Trends of the Results of Sullair
2-4. Trends of the Results of Sullair ・ Both orders and revenues for the 1st quarter of FY2020 fell due to the COVID-19 pandemic ・ Improvement measures for the building of resilient structures were carried out to achieve a higher orders growth rate in the 4th quarter of FY2020 than in the same perio
Slide 14: Contents: Expansion of Total Seamless Solutions
Industry Sector Contents 1. Overview of the Industry Sector 2. Progress of 2021 Mid-term Management Plan 3. Expansion of Total Seamless Solutions 4. Development for Global Growth 5. Conclusion © Hitachi, Ltd. 2021. All rights reserved. 13
Slide 15: Changes in Market Conditions and Aims of the Industry Sector
3-1. Changes in Market Conditions and Aims of the Industry Sector ・ Changes in market environment brought about massive changes in customers’ management perspectives (values of companies) ・ Solving issues of “boundaries” between companies and organizations is more important now Solve issues of “boun
Slide 16: Comparison to Competitors
3-2. Comparison to Competitors ・After the change of market environment, the importance of solving customer issues through comprehensive Products x OT x IT solutions based on collaborative creation with customers has increased ・Hitachi differentiates itself from the competition by advancing total sea
Slide 17: Total Seamless Solutions Applied to Boundary Issues
3-3. Total Seamless Solutions Applied to “Boundary” Issues Capitalize on the strengths of Products x OT x IT to solve issues of “boundaries” through collaborative creation with customers and create new value for society Connect through digital technologies Connect through digital technologies Connec
Slide 18: Expansion of Total Seamless Solutions utilizing Lumada
3-4. Expansion of Total Seamless Solutions utilizing Lumada Expand total seamless solutions with the strengths of technologies, domain knowledge and customer relations Until FY2019 FY2020 From FY2021 onwards Collaboration with Microsoft Collaboration Nichirei Logistics with Hitachi Group Transport S
Slide 19: Examples of Introduction of Lumada Digital Solutions
3-5. Examples of Introduction of Lumada Digital Solutions Connect Supply Chains Globally 1 Daikin Industries, Ltd. Connect Sales Workplace and Markets 2 Seiyu GK & WORKMAN Co., Ltd. Connect Workplace and Management 3 in Logistics Field MonotaRO Co., Ltd. Connect Workplace and Management 4 in Logisti
Slide 20: Customer Case 1: Connect Supply Chains Globally
Collaborative Creation Customer Case 1. Connect Supply Chains Globally For Daikin’s chemical business, five manufacturing bases and nine sales bases are connected globally to provide production/sales planning and execution support solutions that quickly respond to changes in demand Optimization of s
Slide 21: Customer Case 2: Connect Sales Workplace and Markets
Collaborative Creation Customer Case 2. Connect Sales Workplace and Markets Contribute to productivity improvement of sales workplace by automating order placement operations based on the demand forecasting by AI Provide value that corresponds to the characteristics and needs of each of Seiyu and WO
Slide 22: Customer Case 3: Workplace and Management in Logistics
Collaborative Creation Customer Case 3. Connect Workplace and Management in Logistics Field Realize improved productivity by automated transfer at MonotaRO Aim to optimize the whole distribution center from workplace to planning Sophistication of the ERP SCM ・Schedule Vertical linkage ・Production al
Slide 23: Customer Case 4: Workplace and Management in Logistics
Collaborative Creation Customer Case 4. Connect Workplace and Management in Logistics Field Realize both safety and efficiency improvements by combining Hitachi Transport System’s unique safe operation management solution utilizing AI with the delivery optimization service Digital platform for logis
Slide 24: Customer Case 5: Connecting Different Companies
Collaborative Creation Customer Case 5. Provide a Place for Connecting Different Companies Through collaborative creation with a pharmaceutical wholesaler (Alfresa) etc., provide Japan's first* platform for integrated management of cell and tracing information throughout the value chain for regenera
Slide 25: Customer Case 6: Food Field
Collaborative Creation Customer Case 6. Connect Workplace, Management, and Supply Chain in Food Field Through collaborative creation with Nichirei Group, provide a planning/operating efficiency improvement solution at manufacturing/processing factories and distribution centers (food value chain) Man
Slide 26: Contents: Development for Global Growth
Industry Sector Contents 1. Overview of the Industry Sector 2. Progress of 2021 Mid-term Management Plan 3. Expansion of Total Seamless Solutions 4. Development for Global Growth 5. Conclusion © Hitachi, Ltd. 2021. All rights reserved. 25
Slide 27: Growth of the Global Business Centering on North America
4-1. Growth of the Global Business Centering on Operations in North America ・ Establishing a North American business base through M&A and strengthening differentiating technologies ・ Accelerating global expansion by strengthening robotic SI while simultaneously reinforcing the fusion of Lumada-based
Slide 28: Fusion of Robotic SI and Digital Technologies: Rolls Royce Case
4-2. Fusion of Robotic SI and Digital Technologies: Rolls Royce Case ・ Automation of large-scale robots, processing equipment and conveyers collaboration between ERP and MES for the processing of aircraft components ・ Acceleration of the fusion of robotic SI and digital technologies through synergie
Slide 29: Strengthening Robotic SI: Acquisition of Kyoto Robotics
4-3. Strengthening the Functions of Robotic SI: Acquisition of Kyoto Robotics • Acquisition of a start-up that supplies an intelligent robotic system equipped with a world-class 3D vision sensor • Deepening the seamless operation between the workplace and management by strengthening the company’s 3D
Slide 30: Use Case of Intelligent Robotic Systems
4-4. Strengthening of the Functions of Robotic SI: Use Case of Intelligent Robotic Systems • Upgrading logistics center operations through the OT x IT solution and facilitate NTT DOCOMO’s logistics operation reform • Applying the piece picking method for practical use through Kyoto Robotics’ intelli
Slide 31: Strengthening the Global Development of the Robotic SI Business
4-5. Strengthening the Global Development of the Robotic SI Business • Strengthening robotic SI featuring digital fusion through the execution of cross-regional comprehensive activities • Strengthening and expanding the robotic SI business based on North American strategies developed by Hitachi Indu
Slide 32: Contents: Conclusion
Industry Sector Contents 1. Overview of the Industry Sector 2. Progress of 2021 Mid-term Management Plan 3. Expansion of Total Seamless Solutions 4. Development for Global Growth 5. Conclusion © Hitachi, Ltd. 2021. All rights reserved. 31
Slide 33: Initiatives for Creating Environmental Value
5-1. Initiatives for Creating Environmental Value Creating sustainable environmental value as well as economic value through collaborative creation with customers Digital Solution Business Utility Solution Business Industrial Products Business Reducing CO2 by optimizing Reducing CO2 by making advanc
Slide 34: Intensive Actions for the Growth of the Industry Sector
5-2. Intensive Actions for the Growth of the Industry Sector To achieve business growth and business value enhancement in the Industry Sector Intensive actions Facilitating the evolution of Accelerating growth Strengthening the total seamless solutions globally management base ● Creating new social
Slide 35: Conclusion
5-3. Conclusion Aiming to achieve revenues upwards of 1 trillion yen and an adjusted operating income ratio exceeding 10% as the best solution partner for industrial customers Adjusted operating income ratio 8.2％ Over 10% 5.7％ Over 1,000.0 Revenues (billion yen) 858.1 880.0 Global/growth area 322.2
Slide 36: Appendix
Industry Sector Contents Appendix © Hitachi, Ltd. 2021. All rights reserved. 35
Slide 37: Appendix 1: Progress in 2021 Mid-term Management Plan
Appendix 1: Progress in 2021 Mid-term Management Plan Unit: billion yen FY2019 FY2020 FY2021 YoY YoY Forecasts YoY Targets Change from (as of June 2021) (announced on IR Day previous targets in June 2019) Revenues 867.8 94% 858.1 99% 880.0 103% 1,000.0 88% Overseas revenues ratio 21% Down 8.2 points
Slide 38: Appendix 2: Growth (Value) Drivers and Risk Factors
Appendix 2: Growth (Value) Drivers and Risk Factors Growth drivers: Increase in digital investment for the acceleration of DX taking place amid the COVID-19 pandemic and measures taken to satisfy demand in the growth market Risk factors: Delay in recovery of the Japanese economy due to the COVID-19
Slide 39: Cautionary Statement
Cautionary Statement Certain statements found in this document may constitute “forward-looking statements” as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such “forward-looking statements” reflect management’s current views with respect to certain future events and financial
Slide 40: Hitachi Social Innovation is POWERING GOOD
Hitachi Social Innovation is POWERING GOOD
Slide 41: HITACHI Inspire the Next
HITACHI Inspire the Next